Nifty Option strategy:

In last two months the implied as well as realised volatility of Nifty has fallen alot.

This leads to attractive long volatility strategies like straddle.

Trade idea: Buy 5400-Nifty April Call and Buy 5400-Nifty Put. The total option premium for the trade is arround Rs. 150 (Rs. 60 + Rs. 90)

The breakeven for the trade would be nifty ending lower than 5250 or higher than 5550.

The implied volatility for both trades is arround 14% p.a. and 13.6% p.a. These levels of implied volatility look very attractive since just few months back the levels were above 30%.

Techically nifty closed today at 5366 after remaining sticky at the resistance level of 5360. Month end view of Nifty would be atleast +-200 points, inline with the long volatility trade.